SIGAR

QUARTERLY HIGHLIGHT
Suspensions and Debarments: An Important
Tool to Safeguard America’s Investment in
Afghanistan
Since its inception, SIGAR has recognized that fraud
committed by contractors and other recipients of government
funding has been a major threat to the success
of reconstruction efforts in Afghanistan. The inability
to address fraudulent conduct by individuals and organizations,
whether through shoddy performance, false
claims, diversion of resources, or, in many cases outright
theft, puts military personnel, contractors, and their
employees at risk.
The best-known remedies for fraud or other misconduct
are criminal prosecution or civil litigation. These
remedies are often unavailable in Afghanistan, so SIGAR
also uses a lesser-known, but effective, option—suspensions
and debarments.
Suspensions and debarments are actions taken by
U.S. agencies to exclude companies or individuals from
receiving federal contracts or assistance because of
misconduct. They are important tools for ensuring that
agencies award contracts only to responsible entities.
SIGAR’s program addresses three challenges facing U.S.
policy and contingency contracting in Afghanistan:
• the need to act quickly
• limited U.S. jurisdiction over Afghan nationals and
Afghan companies
• difficulty in vetting multiple tiers of subcontractors
SIGAR makes referrals for suspensions and debarments
based on its completed investigations. In most
cases, a referral is the only remedy for contractor misconduct
after a contracting office fails to prosecute or
take remedial action in response to an allegation. In
making referrals to agencies, SIGAR provides the basis
for a suspension or debarment decision, as well as supporting
documentation in case the contractor challenges
the decision. SIGAR has found it necessary to refer
some individuals or companies on multiple occasions
for misconduct or poor performance.
How it Works
SIGAR’s mission is to conduct audits and investigations
of all U.S. government agencies engaged in Afghanistan
reconstruction. Operating in a foreign legal jurisdiction
makes that challenging. Other complications include the
presence of third-country civilians, foreign corporations,
NATO military and civilian personnel, nongovernmental
organizations, and an active and ongoing insurgency.
Criminal prosecutions and civil cases often encounter
significant difficulties in developing sufficient evidence
or establishing the jurisdiction required to bring a criminal
or civil case in a U.S. District Court.
SIGAR initiated its suspension and debarment program
because many instances of fraud were not being
addressed due to lack of a means to impose criminal
or civil remedies, or lack of a mechanism to ensure
referral to agency suspension and debarment officials.
SIGAR found, however, that recipients of government
funding in Afghanistan considered the financial consequences
and social stigma of being excluded from
contracts, grants, and other programs to as great or
greater punishment as criminal sanctions. In response,
SIGAR developed a program to ensure that referrals
for suspensions and debarments took place in a
timely manner and not as afterthoughts to criminal and
civil remedies.
In contingency contracting, there are often barriers
between the agent or auditor gathering information on
a contractor and the agency attorney assembling the
case for review by the suspension and debarment official.
Agencies’ agents or auditors typically have minimal
contact with the attorney conducting the suspension
or debarment, and the attorney has no oversight over
the conduct of the investigation. This is especially
true in contingency-contracting environments that are
geographically remote, and where there is no preexisting
relationship between the agent or auditor and the
attorney. The result can be misunderstanding about
how, when, and why suspension and debarment may
be applied.
REPORT TO THE UNITED STATES CONGRESS I JANUARY 30, 2017 55